Climate Change Minister Mark Butler says that moving quicky to an Emissions Trading Scheme is the best way to drive down carbon pollution and says the environment doesn't care about the price of carbon.

Transcript

CHRIS UHLMANN, PRESENTER: The Prime Minister has declared the Carbon Tax terminated. It's a move that's been touted since Labor's leadership changed three weeks ago. The Climate Change Minister is Mark Butler and he joined me a short time ago from Rockhampton.

(To Mark Butler): Mark Butler, welcome.

MARK BUTLER, CLIMATE CHANGE MINISTER: Thank you, Chris.

CHRIS UHLMANN: So by your actions today you admit that the carbon price is too high and will stay too high for another year?

MARK BUTLER: Well, the decision we've taken today is to terminate the carbon tax and to bring forward an emissions trading scheme. This was always our ambition to move to an emissions trading scheme, recognised around the world as the most effective and efficient way to drive down carbon pollution but the decision we've reached or the view we've reached is that we can do that more quickly than was the view a year or two ago. A year or two ago people thought we would have to be in this period of a fixed price or a carbon tax as some people call it for three years to allow business to adapt to the process of submitting permits and acquitting them and so on. We've seen that work very smoothly thus far and we think now we can move much more quickly to an emissions trading scheme than we thought otherwise.

CHRIS UHLMANN: You think that now because you've changed leaders and you have a problem with the carbon tax it's not a policy reason at all, is it, Minister?

MARK BUTLER: It is a policy reason. The Prime Minister was quite clear, even back last year, that he would - if he were leader again he would like to explore the opportunities to move more quickly to an emissions trading scheme...

CHRIS UHLMANN: But he wasn't Prime Minister until two weeks ago, when was the policy work on this begun?

MARK BUTLER: From my point of view as the new Climate Change Minister and the Treasurer's view as the new Treasurer, the incoming Prime Minister, Prime Minister Rudd asked us to set about this work very quickly and we've been working on it very hard over the last couple of weeks.

CHRIS UHLMANN: Because you have a political problem, not a policy problem?

MARK BUTLER: We have a challenge to make sure we get the best possible policy to drive down carbon pollution, a policy supported by households and businesses as the right thing to do for the country's future and the world's future and we think that moving quickly to an emissions trading scheme is the best way to do that.

CHRIS UHLMANN: Because the price of $24 is high by international standards so you admit the Coalition has been saying for the last year that was the problem with this system and you've conceded that today?

MARK BUTLER: Well, we concede today that we can move more quickly from a carbon tax arrangement to an emissions trading scheme. We've done that hard work over the last couple of weeks and we've announced that decision today. We make no apology for it. We think it will be far better for the country, better for households, better for business on input costs and better for the environment because we move more quickly to having a cap on carbon pollution and starting to see that legal limit driven down over the course of this decade to 2020 and beyond after the international negotiations that we're a about to start take fruit.

CHRIS UHLMANN: You say the average family will receive a cost of living benefit in 2014/15, of $380 a year and that's based on a carbon price of six dollars a tonne, where do you get that price from given that Treasury's latest estimate on it for 2014/15 was $12 a tonne?

MARK BUTLER: Well Treasury has obviously modelled this over the last couple of weeks and we expect, and Treasury advised us this was a reasonable expectation that the Australian price will converge with the European price. We've asked Treasury to model this and make the appropriate costings.

CHRIS UHLMANN: Is it treasury figure or is it your figure? That price of six dollars is the price at the moment, that doesn't mean that's what it's going to be in 2014/15. And you will be aware of course that the Europeans are trying to force that price up at the moment so where do you get six dollars from?

MARK BUTLER: Well your viewers will be comforted by the fact that I don't make these figures, we ask Treasury for proper advice and proper forecasts about what they think the European price will be in 2014/15, and advice about whether our price, Australia's price is likely to converge with that. That was the advice of Treasury and it is appropriate that once we get that advice that is the basis for our costings and our - ultimately our savings process.

CHRIS UHLMANN: So how will a carbon price of six dollars drive any investment away from coal fired power?

MARK BUTLER: That ultimately will be up to business. At the end of the day from the environment's point of view, the environment doesn't care about the price being paid. The environment cares about the quantum of carbon pollution being spewed into the atmosphere. The essence of an emissions trading scheme from the environment's point of view is that there will be caps every year reducing on the carbon pollution that can be put into the atmosphere from Australia. What the price ends up being that business is paying to participate in that process will ultimately be a matter for business. Alongside that what we've got to do is to have in place a suite of policies that boost renewable energy sources and you will notice from the savings exercise we went through that we were able completely to quarantine all of our renewable energy projects so that we continue to see solar power and wind power increases a share of the national electricity market. They increase by a share of over 25 per cent only last year. We'd like to see that continue.

CHRIS UHLMANN: And Minister, you're making the argument, all the things that are happening at the moment are happening by direct action, nothing that's going to happen will happen because of the six dollar carbon price.

MARK BUTLER: Well at the moment the carbon price doesn't have a cap on pollution. The essence of the emissions trading scheme is to have a cap on pollution, it actually starts to drive the total amount of carbon pollution in the economy down. By moving to an emissions trading scheme one year earlier we're also moving to a cap on carbon pollution, one that doesn't exist now. We're also moving to a cap one year earlier. The amount of that cap will be advised to Government by the climate change authority, an authority chaired by Bernie Fraser, the former governor of the Reserve Bank and that's really what will start to drive business to move and operate in cleaner and more efficient ways.

CHRIS UHLMANN: Minister, in 2007 you took an emissions trading system to the people, they voted on that, it then was dumped before the 2010 election, you changed your policy, you took a different policy to that election and then you changed your position again in government because circumstances have changed. You've just changed your position again on the way that this system is designed, why should anyone believe what this Government says about the way that this system will look next year or the year after?

MARK BUTLER: Well I don't agree with that assessment either, Chris. We took an emissions trading scheme as our policy to the 2007 and 2010 election. That has been...

CHRIS UHLMANN: Just to clarify that's going to start in 2013, that was the policy that you took to the 2010 election.

MARK BUTLER: That's right and we didn't have the numbers in the parliament to get that through.

CHRIS UHLMANN: So circumstances changed.

MARK BUTLER: So circumstances change because the numbers in both houses of Parliament changed and instead of completely turning our back on the climate and the environment we decided instead to enter into good faith negotiations with other parliamentarians and reach a compromise. It was not our best case solution, it was not the policy we took to the election but in my view it was still far preferable to the alternative which was simply turning our back on the environment.

CHRIS UHLMANN: Certainly finally then, Minister, what if circumstances change again next year?

MARK BUTLER: Well, we're going to take to the election the clearest possible policy on climate change and now the Greens party decided in 2009 to turn their back on emissions trading scheme. I think that was a terrible, terrible mistake on their part. For them to do it a second time after an election where we've taken a very clear policy would be more than a mistake, it would be utterly unforgiveable.